RALEIGH, N.C. | Winston Hotels, Inc. (NYSE: WXH), a real estate investment trust (REIT) and owner of premium limited-service, upscale extended-stay and full-service hotels, today announced that it has acquired the 135-room Courtyard by Marriott in Roanoke, Va. from Tidewater Resorts and Hotels based in Virginia Beach, Va. for $11.9 million. Alliance Hospitality Management, LLC will operate the hotel.

"This is a well-located property in a strong secondary market, with multiple demand generators, which matches up well with our existing portfolio of premium-branded, mid-market properties," said Joe Green, president and chief financial officer. "Roanoke has been named All-American City for five years, as well as one of the U.S.'s top 100 hot spots for business development, and is typical of the kind of markets we are targeting. We continue to have a strong appetite for acquisitions, as well as for our subordinated loan program."

Green noted that the hotel opened in late 2002 and is centrally located at the intersection of Interstate 581 and Hershberger Road and is within one mile of the Roanoke Regional Airport. The Courtyard is the newest hotel in the city's airport area. The hotel offers limited food and beverage service, including a breakfast buffet, as well as high-speed Internet access throughout the hotel, a business center equipped with computers, printers, fax and copy service, an exercise room, guest laundry facilities, and an indoor swimming pool.

"We are seeing more properties come to market," Green said. "Prices are increasing, but they are reflecting the improvements in the economy and hotel industry. We remain patient buyers and continue to build relationships with sellers and developers."

Raleigh, North Carolina-based Winston Hotels, Inc. is a real estate investment trust specializing in the development, acquisition, and repositioning of, and provision of subordinated financing to, premium limited-service, upscale extended-stay and full-service hotels, with a portfolio increasingly weighted toward the leading brands in the lodging industry's upscale segment. The company currently owns or is invested in 52 hotels with an aggregate of 7,320 rooms in 15 states, which includes: 45 wholly owned properties with an aggregate of 6,397 rooms; a 49 percent ownership interest in one joint-venture hotel with 118 rooms; a 48.8 percent ownership interest in one joint venture hotel with 147 rooms; and a 13.05 percent ownership interest in five joint-venture hotels with 658 rooms. For more information about Winston Hotels, visit the Winston Hotels Web site at .

In addition to historical information, this press release contains forward-looking statements. The reader can identify these statements by use of words like "may," "will," "expect," "project," "anticipate," "estimate," "target," "believe," or "continue" or similar expressions. These statements represent the company's judgment and are subject to risks and uncertainties that could cause actual operating results to differ materially from those expressed or implied in the forward looking statements including, but not limited to, changes in general economic conditions, lower occupancy rates, lower average daily rates, acquisition risks, development and redevelopment risks including risk of construction delay, cost overruns, occupancy and other governmental permits, zoning, the increase of development costs in connection with projects that are not pursued to completion, lender consent rights in making mezzanine loans, the risk of non-payment of mezzanine loans, or the failure to make additional mezzanine debt investments and investments in hotels. Other risks are discussed in the company's filings with the Securities and Exchange Commission, including but not limited to its Annual Report on Form 10-K for the year ended December 31, 2003, Quarterly Reports on Form 10-Q and its other periodic reports.

Patti L. Bell
919/510-8003
Winston Hotels